Eternal Q4 Results: Profit Down 34%, Misses Estimates

Zomato Ltd.'s net profit tanked 34% in the January-March period, missing analysts' expectations, with Bloomberg consensus estimates predicting a profit of Rs 42 crore.

However, the company's revenue showed growth, increasing by 7.9% to Rs 5,833 crore for the quarter, ahead of the expected Rs 5,824 crore.

Zomato Q4 FY25 Key Highlights (Consolidated, QoQ)

• Revenue up 7.9% at Rs 5,833 crore versus Rs 5,405 crore (Bloomberg estimate: Rs 5,824 crore).

• Ebitda down 55.6% at Rs 72 crore versus Rs 162 crore (Bloomberg estimate: Rs 101.7 crore).

• Margin at 1.2% versus 3% (Bloomberg estimate: 1.7%).

• Net profit down 34% at Rs 39 crore versus Rs 59 crore (Bloomberg estimate: Rs 42 crore).

Zomato, in its letter to shareholders, reported steady adjusted revenue growth of 60% year-on-year during the March quarter. However, its adjusted Ebitda declined by 15% year-on-year, largely due to the accelerated expansion of its quick commerce business, Blinkit.

Blinkit added a record 294 net new stores during the quarter and remains on track to reach 2,000 stores by December 2025.

In the food delivery segment, gross order value grew 16% year-on-year but dipped 1% quarter-on-quarter, while net order value rose 14% year-on-year and fell 3% quarter-on-quarter. The company's District App is scaling up and now contributes to one-third of the going-out gross order value.

Zomato announced the shutdown of its Zomato Quick and Zomato Everyday initiatives, citing no clear path to profitability without compromising customer experience. The company stated that current restaurant density and kitchen infrastructure do not support consistent 10-minute deliveries, and the Everyday homely-meals offering addressed only a limited-use case.

Key highlights from Zomato's shareholder letter also include the company's expectation of steady profit potential in the business at a rate of 5-6%. Zomato has revised its adjusted Ebitda margin guidance upwards to 5-6% of net order value, signaling its confidence in improving operational efficiency despite current challenges.

Additionally, the company plans to present shareholders with a detailed proposal seeking approval to begin owning inventory within its quick commerce business, a move that could further shape Blinkit's expansion and profitability path.

Despite these forward-looking plans, Zomato acknowledged that growth in its core food delivery segment remains under pressure. The company cited sluggish consumer demand, a shortage of delivery partners, and intense competition in the market as key factors holding back stronger growth momentum in this part of the business.